SALIENT FEATURES OF THE BILL:-

1) SARFAESI

RBI will get more controls to audit & review any ARC as well as the freedom to remove the chairman or any director & appoint central bank official to its board.

RBI will be allowed to levy penalties for non-compliance with its directives & control the fees charged by these companies to banks at the time of acquiring such assets.

The bill recommends to broaden the scope of the registry that will house the central database of all loans against properties given by all lenders.

Bill provides that secured creditors will not be able to take control over the collateral unless it is registered with the central registry. Further, these creditors, after registration of security interest, will have importance over others in repayment of dues.

Enable secured creditors to take over a company and restore its business on acquisition of controlling interest in the borrower company.

2) DRT

Taking account of interest of creditors- 50% of the debt has to be deposited with DRT for filing an appeal.

The bill also suggests to amend the Indian Stamp Act so that stamp duty will not be charged on the transfer of financial assets in favour of ARCs.

The bill will pave the way for the sponsor of an ARC to hold up to 100% stake. It will also permit non-institutional investors to invest in security receipts issued by ARCs and mandate a timeline for possession of secured assets.

By fast-tracking the recovery procedure for banks and other financial institutions.

Widens the space of the central registry that will house the central database of all loans against properties given by all lenders.